A Non Resident (Ordinary) Account can be opened and maintained by - any person residing outside India being an NRI & also a foreigner i.e. both Bala Chander residing in USA as an NRI as also Bill Clinton residing in USA too as a foreigner can open and operate NRO accounts.

The accounts are not convertible / non repatriable and are maintained in Indian rupees in the form of savings, current and recurring or fixed deposit accounts.

Provisions as regards eligibility, types of accounts, permitted debits / credits, rate of interest, Loans against the security of funds held in NRO account, change of residential status of account holder, repatriation of funds by NRI nominee, and miscellaneous matters such as joint holding, operations by POA etc. are provided herein.

Note: Opening of accounts by individual/entities of Bangladesh/Pakistan nationality requires approval of Reserve Bank of India.

.02"Person of Indian Origin" means an Indian citizen or a foreign citizen other than citizen of Bangladesh and Pakistan who;

i) at any time held an Indian Passport, or

ii) himself or his parents or grand parents were citizens of India , or

iii) is a spouse of an Indian citizen, or

iv) is a spouse of person referred to in (i) or (ii) above.

.03Overseas Corporate Body[OCB] were eligible to open and maintain NRE account till 3.10.2003..
OCB means a Company, Partnership Firm, Society or body wherein 60 % or more ownership lies with NRIs or a Trust wherein 60 % or more financial interest is irrevocably held by NRIs.

Any person resident outside India including an NRI who is a citizen of India or a foreign citizen of Indian origin residing outside India as also a foreigner and an Overseas Corporate Bodies (OCBs).
Opening of accounts by individual/entities of Bangladesh/Pakistan nationality/ownership requires approval of Reserve Bank.

2

Currency

Indian Rupees.

3

MODE OF DEPOSIT

Period

Income from domestic non-repatriable sources or realisations from local investments / sources ,

transfer from NRE/FCNR accounts ; forex remittance from abroad or deposit of foreign exchange during visit to India

15 days to 120 months

4.

JOINT HOLDING

Permissible with other NRIs as well as Residents. (resident attorney can also operate).

5

INTEREST

Banks can offer at par with resident accounts.

6.

REPATRIABILITY

Interest Repatriable- subject to payment of tax

Balance repatriable upto US$ 1 mn per financial year [under US $ one million scheme] Repatriation from NRO to NRE is permissible w. e. f. 07th May 2012.

7

LOANS

Available to account holder as well as third party resident in India

8

NOMINATION

Permissible with NRIs as well as Residents.

9.

TRANSFERS

Permissible in account holder's other NRO accounts or NRE accounts.

10.

VARIOUS TYPES OF ACCOUNTS

Saving, Current, Recurring and Fixed Deposits account.

11

PREMATURE WITHDRAWAL

Permissible: - However for period of less than 15 Days - No interest payable ; above 15 Days - Subject to Penalty - As per Bank Rules.

12

TAXABILITY

Interest income liable to tax

Balance not subject to Wealth Tax.
No Gift Tax provisions in India . However w.e.f. 1-4-2006 amount received in excess of Rs.50,000 by way of gifts from persons other than specified relatives is included in donee’s income and chargeable to income tax.